Lets face it living on your own will hurt you greatly when it comes to finances. Living at home is very easy to exploit by saving a larger chunk of your earnings. So how is one to transition from living at home to living on their own? The answer is pretend you are living on your own while still at home. Or as some would say fake it till you make it.
This may sound stupid right off the bat but think about it for a second. Living on your own you have to pay for the following expenses:
1. Rent or mortgage payment
2. Mortgage/home insurance
3. Utilities
4. Groceries and the list goes on and on.
Now when you live at home with your parents chances are you have the following expenses:
1. Cell phone bill
2. Weekends
My solution is to pretend you are living on your own by setting up a bank account where you will pay yourself rent and utilities (just a starting point) at the end of every month. What’s the best way to do this? By following the directions below.
1. Do some research. Look into a property that you wish to rent or own in the near future. Be realistic in your research and try to find a property that fits your budget. Once you find the ideal piece of property, find out the price.
2. Determine costs of utilities. Talk to people and think about it from your own perspective on how much money you would need every month to cover the cost of utilities.
3. Write a budget. Write out a general budget based on your salary and the cost of rent/mortgage and utilities.
4. Pay these costs into a bank account. Setup a new bank account where at the end of every month you will put money into the account based on your calculations of the costs of living on your own.
5. Reflect and determine if it is feasible. If you find that after a few months you are unable to come up with the money into the bank account then maybe you are not ready to live on your own.
{ 3 comments… read them below or add one }
For my little brother who moved out a few months ago, I know this was a huge shocker! It’s like, “Wait a minute! Nobody told me toilet paper was THAT expensive!”
Poor guy. He got used to it.
What would you personally do with the money in this bank account? Use it as an emergency fund? Use it to pay deposits and buy furniture when you do make it out?
Thanks for taking up my suggestion, btw
Awesome, finally an interesting post that many of us can relate to.
I think you should have a few thousand in savings before moving out.
Also you will need probably a thousand or so to buy like furniture, bed, kitchen supplies and anything else needed to move in to the new place.